Step 1 (from Suze) – Delay Tapping Social Security Until 70

There is no one size fits all for when it is best to begin Social Security.

Full retirement age is from 65 to 67 (based on the year of your birth). However, delaying benefits until age 70 increases your benefits by 8% per year after full retirement age. And taking benefits at age 62 (the earliest you can take benefits) permanently decreases your benefits by five-ninths of 1% for each month up to 36 months before full retirement age and an additional five-twelfths of 1% per month if you start taking benefits more than 36 months before full retirement age.

Sound complicated? It’s not supposed to be. Remember that Social Security is designed to pay out the same amount of money over an average person’s lifetime regardless of when they file for benefits.

From the estimator, you can do a break-even analysis to determine when the total of the benefits received equals the same amount under different age elections.

Once you determine your break-even age, you can make choices based on individual needs, such as:

Immediate cash needs. People with other sources of income may choose to delay benefits.

Health. If you are in poor health, taking benefits early may be the right decision.

Spousal Benefits. If one spouse significantly outearns the other, it makes financial sense for the lower earner to claim spousal benefits early and delay the benefits for the higher earner.

Income. Earned income may temporarily reduce your benefit if you take Social Security before full retirement age.

Step 2 (from Suze) – Lay the Foundation Now to Work Longer Later

Counterstep 2 (from Dash2Retire) – Lay the Foundation Now to Stop Work Sooner

People leave the workforce for a variety of reasons, some intentional and some unintentional. Many people choose to retire before full retirement age because they have accumulated enough assets to support their lifestyle without relying on an earned income. Others leave for reasons beyond their control:

Downsized at a company

Health crisis for themselves or a family member

To care for aging parents

A solid financial foundation will allow you to meet any challenge head-on. Financial independence though wealth building is the goal of this site. Getting debt under control, maximizing earnings and boosting savings are vital to building wealth.

According to Suze,

Every dollar you don’t spend in your 60s is a dollar that can keep growing for your 70s and beyond.

True enough. But the same can be said for every dollar you don’t spend in your 20s, 30s, 40s or 50s.

No one can predict the future. Building a strong financial foundation will require sacrifices today. But having the peace of mind that comes with a solid financial foundation is worth the sacrifice. And it will provide you with options that others, who are financially unprepared, may not have.

Step 3 (from Suze Orman) – Truly Enjoy a Secure Retirement

Counterstep 3 (from Dash2Retire) – Suze’s right on the money with this one!

As Suze says:

Having a clear-eyed vision of how navigating your 60s can set you up for a worry-free retirement should make you feel empowered. It’s the difference between holding your breath that everything will work out okay, and taking the steps today so you can confidently breathe easy knowing you have a plan that will work out just great.

On a least one point we agree. And I couldn’t have said it better myself!

31 thoughts on “Retire at 70? No thank you!”

I worked way past FI because it was fun and if it had not stopped being fun I might have kept working longer. Now that I am retired I still work about two days a week because I enjoy it and it offers a mental challenge that differs from my hobbies and volunteer work. But it is only fun because I don’t have to do it! I’m with you, working to 70 because you have to, that is a terrible plan.

Thanks for the comment. It’s so good to hear a story like yours of someone who continued to work because they love it and not because they have to. You’re a perfect example of what FI is all about – OPTIONS!

I’m 60 and my wife is 56. We are FI but continue to work for now because we just aren’t quite ready for full retirement. My wife enjoys what she does on most days. She is very motivated, makes a good salary, provides our health benefits and savings plan through her employer and gets to travel to some cool places. I’ve become an entrepreneur working with startup companies. My income is highly variable and no benefits to speak of so my wife’s job really helps out in this area. Because much of my compensation is tied to equity in the companies I work with, we will either do really well or get very little in return for my efforts. Either way, I’m enjoying the challenge and learning new things and can afford the highly leveraged risk-reward compensation plan because of the good planning we did together to achieve FI.

Like you said, achieving FI really does afford you many options that most people can’t take advantage of because they can’t take the risk of leaving something steady and seemingly secure for something more risky but with a chance of significant returns. When the worst thing that can happen is you simply retire if things don’t work out, that isn’t a bad place to be in life.

Thanks for the comment. Congrats on your FI and the options you have. You are definitely living the dream life for my husband. We live in an area with some amazing start-up ventures. Many of the former employees from his company have either started or joined these companies in their infancy. And fortunately, like you, he has done very well in his career, which affords him some great opportunities. The other option he is considering: teaching some business classes at a community college.

Teaching is something I’ve considered as well. My Mom taught high school for 41 years so I guess I come by it honestly. I’d love to teach a Life 101 course to graduating seniors to help them get started off on the right foot in a number of areas. Things like career planning, organizational behavior, office politics, investing for life, the importance of networking, etc. I just think universities do a poor job of really preparing their students in areas like these and I’d love a shot to help change that. If I have success in this entrepreneurial stuff, I might add that as well 😉

It is ok to work until age 70 or older if that is what you want to do. Your financial plan should be designed to have the option of retiring at a much younger age. There are too many health, economic, and family related variables that could force a person out of the labor market at a much younger age. If that occurs, it is a much easier transition if you are already financially independent.

YESSSSSSS! Love this post. I saw this advice from Suze around the same time that I saw her quote that you should have 8+ months of living expenses in your emergency fund. So if you follow Suze’s advice on working and saving, you will probably never have a financial hiccup in your life. But will you come close to living your best, most fulfilling life? If you protect yourself like Bubble Boy, what have you achieved? You’ve taken limited financial risks to grow wealth (because you have huge amount of money tied-up in safe, low-interest cash savings) and you’ve worked until you are closing in on death. I guess you will never be a financial burden on anyone, which is not insignificant, but I agree with you 100% that you should be planning , investing and taking steps toward something more inspirational.

My husband had the big heart attack a few months after his 62nd birthday. No retirement for him. He had worked hard since he was a teenager. He had a good job. He had always had a job. I benefited well from his good work ethic and savings, but I sure would rather have seen him and his good nature retire early and enjoy himself for a while instead. Suzie does not always know best !

Hi Teri,
So sorry to hear about your husband’s heart attack. Your comments should strike a cord with everyone, no one knows when a health crisis will strike. It is much better to be prepared for the worst. And once you reach a level of financial independence that suits you, it’s time to take some time to enjoy the fruits of your labor. For some, it will be early retirement. For others, it may mean still working, but enjoying life a bit more!

I agree. The interest on savings is so low these days. But there is no reward without some risk. It’s a real balancing act, especially for those who are retired or are near retirement and need their money to last decades.

Her comments make my blood boil. Sure 70 is right for some but I really don’t think it should be the target. I’m going for 45. Thanks anyway Suze. With this post, you should be the nationally syndicated expert. Not her.

There is an upper level manager where I work who forgets what he says or agrees upon from one meeting to the next. He’s not that old, so I’m hoping it’s lack of caring, not early alzheimers.
My dad was downsized (before 62) from a management position when senior management changed. His years of frugality meant he did not have to get another job.
Some of my grandparents passed around age 72, and while we have improved medical technology, if it’s something undetectable and quick, I’d rather not take chances. I’m already pursuing FI, because I don’t want to retire at 67!
There are people who need to continue to work til 70. But there is also a generation holding positions, where younger workers have no where up the ladder to move in their careers. That has led to job hopping or FI minded to hop off the ladder completely.
I realized at my last job, I’ll never make C suite in the big company corporate world. In this job I realized, I’m not sure I want the responsibility of some higher level decisions. If I FI and have an llc (or the like), I’ll be my own C suite making decisions that just affect me. 🙂

We watched both of my brothers-in-law (executives at large companies) get downsized at the age of 55. That is one of the reasons we are so keen on achieving financial independence. FI certainly makes getting laid off a lot more bearable and provides security that others certainly don’t have.

I’m with steveark. Working because you have to sucks the big one. And I’m with you on retiring at 70. It doesn’t make much sense to stay on the hamster wheel that long when a little financial savvy can get you off of it ten or more years sooner. Great post.

I remember reading this Suze Orman article. At first I completely understood what she was saying because more than 50% of the American population has less than $1,000 in savings, and the average savings rate in the U.S. is around 5-6%. My thought was that she was targeting this audience because she knew mathematically that these individuals simply couldn’t retire before 70 (even possibly later).

I am totally on your side though of “laying the foundation to stop working sooner.” As long as you are able to build and acquire the right amount of assets through your working life that can then support your lifestyle, in my book you’re then free!

Thanks for the comments. The retirement statistics in America are depressing. I think you’re right about the target audience for Suze, but putting the idea out there that everyone will be ABLE to work until 70 is a little scary.

I’m FI and semi-retired now in my mid-40’s, and maybe I will be working at 70. But if so, I can assure you it will be either at the company I own, or doing something that I enjoy so much that any compensation will be an afterthought and likely donated to charity.

Beautifully served, love it! I can understand that some people do like to work longer, but if anyone has a choice they should do it voluntarily and not because they have to. I love to distinguish between FI/RE and FI/RO (retire optional). What’s wrong with getting ready to FIRE but still working a little longer. There’s no Early Retirement Police that will catch you and ask you to do less. However, if you end up at 70 and didn’t prepare to retire well, then… well then good luck! Great post, love it. Thanks!!!

Suze’s advice makes mathematical sense, especially for those who are late middle-age and have little savings. But I work in oncology and many of my patients don’t live to age 70, or even to age 60. The option to retire early is determined decades earlier however. I strongly encourage folks to teach and encourage their kids early on about the power of compound interest and passive income. Then they can either work later or retire earlier, or a combination of the two, but they get to choose. Thanks for the article!

Thanks for what you do in oncology. I know that must be a very rewarding job to see people get better, but tough when you lose patients.

The option to retire early IS determined decades earlier. Unfortunately, many people don’t even think about retirement until its too late. Then they are stuck working until they are no longer able. Early financial education (from parents and schools) could prevent a lot of heartache.